Meralco calls for new plants

By: Ronnel W. Domingo - 05:10 AM November 06, 2017
http://business.inquirer.net/240026/meralco-calls-new-plants

A subsidiary of the Manila Electric Co. called for the replacement of aging power plants in the Philippines, which is considered one of the decisive ways that the country’s electricity rates— the highest in Southeast Asia —could be lowered.

Chrysogonus F. Herrera, senior vice president of Meralco PowerGen Corp. (MGen), said in a statement that high power rates were “putting a serious threat” on the national economy, particularly the manufacturing sector.

Herrera said unless proactive reforms were implemented to address the issue, the country will continue to lag behind Asian neighbors in terms of socio-economic development.

The MGen official was lecturer last month in the latest of a series under the Energy Policy and Development Program (EPDP) implemented by the UPecon Foundation.

According to Herrera, building new power plants to replace the country’s aging plants was crucial to ensure the country has energy security to support future economic expansion.

He said about three in every five of operating power plants in the Philippines were older than 15 years, or more than half a power plant’s life span of 25-30 years.

“The future presents an opportunity to replace them if they are no longer competitive in the WESM (wholesale electricity spot market), are not environmentally compliant, or they can no longer comply with the resiliency standards imposed by the Department of Energy,” he said.

MGen is awaiting action from the Energy Regulatory Commission on its applications for several power supply agreements (PSAs) filed in April 2016.

According to Meralco, these PSAs “are urgently needed” to ensure adequate, reliable power supply to residential consumers and businesses.

In its latest quarterly performance report, Meralco said further delays in the processing of the PSAs could have an increasingly adverse impact on power plant project costs and completion dates.

The distribution giant was referring to three ongoing MGen projects.

These are the planned 455-megawatt coal-fired plant in Quezon; 600-MW circulating fluidized bed coal-fired plant in Zambales; and 600-MW ultra-supercritical pulverized coal-fired plant, also in Quezon.